An "EU - sweep" is a joint EU enforcement action to check for compliance with
consumer protection laws.

The first such sweep exercise was carried out to check websites selling
airline tickets. It was carried out by the Member States' enforcement
authorities (the Consumer Protection Enforcement Network – CPC, which came
into being at the end of 2006) and was co-ordinated by the European Commission.
There are more sweep actions scheduled for 2008.

Authorities from 15 Member States and Norway participated in this first joint
exercise. Participation was on a voluntary basis. 447 sites were checked for
misleading or deceptive messages and/or information, of which 226 were flagged
as in some way not respecting consumer protection law. 63 were cross border
cases and were flagged for follow up action through the CPC network by
co-operation between national authorities in different EU member states. The
rest will be followed up at national level.

The focus of this EU sweep exercise is not information or fact finding but to
obtain enforcement. Because consumer rights are no good if they're just on
paper, they have to be enforced. This is a whole new way of doing business to
boost consumer rights.

When did it take place?

Enforcement authorities examined sites during the week of 24-28 September.

Why did you pick airline ticket websites for the first sweep action?

Because airline ticket and passenger complaints are one of the leading areas
for complaints coming into the European Consumer Centres (ECC). The ECC-Net is
an EU wide network that provides information on cross border shopping to
consumers, ensures that they are aware of their rights and gives support in the
event of a complaint.

How big is this market

EU Airline travel is a market of 700 million passengers per year. This
includes internal and external travel (external being where an EU citizen
travels beyond the EU) and it is a highly digitalised market.

How does an enforcement "sweep" work in practice?

There are two steps:

The first step is the co-ordinated sweep action where participating
Member States systematically check for practices on different websites which
breach consumer protection law. For instance, it is against consumer protection
rules not to clearly indicate the total price. It is also against consumer
protection rules not to clearly indicate the conditions which apply, for
instance if a special offer is limited in availability.

The second step is the enforcement action. During this phase,
authorities will further investigate websites flagged as "having irregularities"
during the sweep and take appropriate follow up actions to ensure that non
compliant sites are corrected and/or closed. National authorities will
investigate and take enforcement actions for national cases. Where it is a cross
border case enforcement authorities will request assistance from colleagues in
other authorities (e.g. where the trader operates from another country). This
is done via the recently established Consumer Protection Co-operation Network of
national enforcement authorities from 27 Member States and Norway & Iceland.
During this enforcement phase the companies have a right of reply and an
opportunity to correct practices which are illegal. Those who fail to do so
could face legal action leading to fines or closure of their Web sites.

What sanctions can be taken?

EU consumer laws are enforced – and sanctions and penalties are
therefore set – at national level. Possible measures can include a
request to a company demanding to change or cease a prevailing practice,
imposing and collecting fines, or closing down web-sites. Enforcement
authorities are obliged to take measures (repeatedly if need be) until the
infringement has ceased.

The Member states involved

Which Member States participated in the exercise?

The following Member States took part in the sweep exercise: Austria,
Belgium, Bulgaria, Cyprus, Denmark, Estonia, Finland, France, Greece, Italy,
Lithuania, Malta, Portugal, Spain, Sweden. Norway also participated. The full
list of participating authorities which are all part of the CPC Network
(Consumer Protection Co-operation Network) is attached.

Which Member States did not participate and why?

This is the first consumer enforcement sweep and all Member States were very
supportive of the exercise. While it was not possible – due to resource,
timing or other constraints - for all MS to participate on this occasion it does
not mean they were not keen to do so and they will most probably participle in
future exercises.

Why does this sweep need to be done with EU co-operation?

It is obvious that deceptive online selling practices often concern operators
located in different countries and they can more effectively be tackled with the
kind of EU wide co-operation which has been established in the framework of the
Consumer Protection Cooperation Regulation. A website selling to one member
state e.g. France may well be based in Belgium. To get the illegal practice
corrected France needs to request the co-operation of the Belgian authorities.

What about the international dimension. What about airlines operating from
outside the EU and how do we deal with those countries?

This issue is complex. When companies from outside the EU advertise
inside the EU, then EU laws apply. However, enforcement is difficult. For
contract terms, the situation is far more complex and the applicable law
depends on a number of factors and interlinks with international conventions.

However, we are already exploring options to cooperate with the US
authorities in the area of consumer protection, notably via the Enforcement
Network, and plan to expand these discussions to other partners.

Can ICPEN help in such concrete international cases?

ICPEN stands for International Consumer Protection and Enforcement Network.
There are 36 members including 24 EU Member States. It is an international
organisation of enforcement authorities that is mainly a forum for exchange of
information and best practice. Members also participate in case handling which
could include exchange of information in international cases. They also conduct
sweeps as part of their activities.

Some ICPEN member countries also carried out a sweep in the same week of
September. That sweep focused on websites which use testimonials, guarantees
and/or endorsements for misleading purposes, for example, sweepers searched for,
among others, cures for major illnesses such as cancer and AIDS.

The EU laws

What are the EU consumer rules that airline companies need to comply with?

The Consumer Acquis and its translation into national laws are relevant here.
In particular the CPC Regulation (EC) 2006/2004 on consumer protection
co-operation, which set up the new enforcement framework, the Council
Directive 84/450/EEC on misleading advertising and the Council Directive
93/13/EEC on unfair terms in consumer contracts.

Why did you focus on misleading selling practices and unfair contract
terms only?

The sweep targeted key problem areas - misleading information and unfair
contractual terms – these are very common problems encountered by
consumers when they try to buy something on-line.

What kinds of practices are misleading? Can you give practical examples of
practices that are not allowed for sites selling airline tickets?

The price of the ticket is first indicated without airport taxes and
additional fees (e.g. no indication of handling charges, taxes, credit card
fees).

Offers promising tickets for free or at a low price, but such tickets are
not available when the consumer wants to buy them on the web site. Sometimes
those tickets are available for only a very limited period but the advertisement
does not indicate it.

Can you give some examples of unfair
contract terms?

Tick boxes for insurances or additional services are ticked "yes" by
default, trapping the consumer into buying unwanted items or being listed on
spam mailing lists.

General terms of sales are not provided in the language version used by the
consumer during the booking procedure – or not available at all in any
language.

No information about the rights and procedures of cancellation,
transferability and ability to change the date.

Can you tell us
about the new legislation from DG Transport which is in the pipeline?

Yes, it is the Proposal for a Regulation of the European Parliament and of
the Council on common rules for the operation of air transport services in the
Community (COM (2006) 396), the so called "Third Package in Air Transport.

The Regulation will further clarify that the final price includes all
applicable fares, charges, surcharges, taxes and fees which are unavoidable and
foreseeable at the time they are published. These rules will also apply to fares
and rates published on the Internet. It will apply to all flights within the EU
and to flights of all companies departing from an EU airport.

Which articles of the package apply to the subject of the airline ticket
sweep?

The provisions on pricing are included in Chapter 4 of the proposed
Regulation. The Commission proposal is currently being discussed by the European
Parliament and the Council and we hope that an agreement will be reached in the
second reading.

The results

226 sites were found to have irregularities of one or several of the kind
described above. They are further detailed in the Press Release.

Which airlines and companies?

In four months, once the majority of cases will have been dealt with by the
authorities, the Commission intends to publish a list of companies concerned.
The company names are known to the national enforcement authorities which are
now following up at national level and cross border issues for specific
companies will be dealt with through the EU enforcement network.

Did the results demonstrate a cross-border dimension? How significant was
it?

Yes. 63 cases were cross border in nature. It was 27.8% of all infringements.

Were breaches different in different Member States?The above
mentioned examples seem to be the most common problems and the trends were
similar across Member States. We will have a more detailed picture at the end
of the enforcement phase.

Were the same companies checked by different MS and how does this impact
on the results?

Some airlines companies obviously operate in several countries as well as
booking operators. However, they usually have different sites for different
markets and breaches may be found in one language version and not in another. So
the result reflects the numerous sites which are concerned.

What next?

What will the next sweeps focus on?

Obviously, sweeps will always be kept secret until after the preliminary
"sweep" investigation has been carried out to maximise their effectiveness. The
Commission is currently consulting with Member State consumer authorities on the
priority issues for next sweeps programmed for 2008 – to deliver maximum
benefit for consumers and the market.

Annex: 'EU – Sweep' – Airline ticket selling websites

Contact details of participating enforcement authorities

Member State

Authority

Belgium

DG Enforcement & Mediation

Bulgaria

Commission for consumers protection

Denmark

Danish Consumer Ombudsman’s (DCO)

Estonia

The Consumer Protection Board of Estonia

Greece

Directorate for Consumer Protection

Spain

National Consumption Institute

France

DGCCRF-CSCE Morlaix

Italy

Autorità Garante della Concorrenza e del Mercato

(Directorate for Research and International Relations)

Cyprus

Trade Service of the Ministry of Commerce, Industry and Tourism

Lithuania

State Consumer Rights Protection Authority of the Republic of
Lithuania